Topics in Practice Management

Clinical and Financial Considerations for Implementing an ICU Telemedicine Program Robert J. Kruklitis, MD, PhD, FCCP; Joseph A. Tracy, MS; and Matthew M. McCambridge, MD

As the population in the United States increases and ages, the need to provide high-quality, safe, and cost-effective care to the most critically ill patients will be of great importance. With the projected shortage of intensivists, innovative changes to improve efficiency and increase productivity will be necessary. Telemedicine programs in the ICUs (tele-ICUs) are a successful strategy to improve intensivist access to critically ill patients. Although significant capital and maintenance costs are associated with tele-ICUs, these costs can be offset by indirect financial benefits, such as decreased length of stay. To achieve the positive clinical outcomes desired, tele-ICUs must be carefully designed and implemented. In this article, we discuss the clinical benefits of tele-ICUs. We review the financial considerations, including direct and indirect reimbursement and development and maintenance costs. Finally, we review design and implementation considerations for tele-ICUs. CHEST 2014; 145(6):1392–1396 Abbreviations: CMS 5 Centers for Medicare & Medicaid Services; LOS 5 length of stay; tele-ICU 5 telemedicine program in the ICU; UMMMC 5 University of Massachusetts Memorial Medical Center

current trends continue, the United States will see Ifgrowing shortages of physicians in conjunction with

increasing demand resulting from population growth, aging, and other factors.1 The need for critical care is especially high and growing quickly. The presence of trained intensivists has resulted in a 40% reduction in ICU mortality and a 14% to 51% reduction in ICU length of stay (LOS). Despite these benefits, only 10% to 20% of hospitals have dedicated intensivists.2,3 To compound the problem, the number of ICU beds is increasing to keep pace with the aging population. Thus, demand for intensivists will continue to exceed available supply and will almost certainly worsen.4,5

Manuscript received April 9, 2013; revision accepted October 24, 2013. Affiliations: From the Division of Pulmonary and Critical Care Medicine (Drs Kruklitis and McCambridge) and Division of Telehealth Services (Mr Tracy), Lehigh Valley Health Network, Allentown, PA. Funding/Support: Drs Kruklitis and McCambridge are supported by the Dexter and Dorothy Baker Family Foundation. Correspondence to: Robert Kruklitis, MD, PhD, FCCP, Division of Pulmonary and Critical Care Medicine, Lehigh Valley Health Network, Cedar Crest and I-78, PO Box 689, Allentown, PA 181051556; e-mail: [email protected] © 2014 American College of Chest Physicians. Reproduction of this article is prohibited without written permission from the American College of Chest Physicians. See online for more details. DOI: 10.1378/chest.13-0868 1392

Unfortunately, the ability of our current system to train more physicians is not sufficient to meet the demand for the foreseeable future. Thus, innovative changes to improve efficiency and increase physician productivity will be necessary to close the gap. Fortunately, health information technologic advances have helped intensivists to provide high-quality, efficient care to a growing number of patients.6-9 This article focuses on the telemedicine program in the ICU (tele-ICU). When referring to tele-ICU, we include all accompanying health information and biomedical technology that collectively constitute a comprehensive ICU telemedicine program. Such programs permit the leveraging of intensivists to help to compensate for the short supply and growing demand. We discuss first the rationale for tele-ICUs and the outcome benefits and then the financial ramifications of establishing a tele-ICU. Making the Clinical Case for Tele-ICUs Rosenfeld et al8 first reported, to our knowledge, a significant reduction in mortality, LOS, and costs of a tele-ICU at a community hospital surgical ICU. Subsequently, at least 40 additional tele-ICUs have been established to date,10 and 12 additional studies10-21 have examined the associations among tele-ICUs and Topics in Practice Management

patient outcomes. Ten trials showed lower mortality with the use of tele-ICUs.10-17,20,21 The largest study to date evaluated 28,429 patients receiving care in 26 ICUs with varying degrees of supporting technology and tele-ICU involvement.11 This report showed improvements in LOS and mortality. In 2010, two more tele-ICU programs released outcome data showing absolute reductions of 6.7% and 1.9% and relative risk reductions of 30% and 20% in mortality, respectively.10,17 In 2011, Lilly et al20 published the most revealing tele-ICU study to date. This prospective clinical study was of 6,290 adults admitted to any of seven ICUs in an 834-bed academic medical center. The hospital mortality rate was 13.6% during the preintervention period compared with 11.8% during the teleintervention period. The teleintervention period had higher adherence to best clinical practice for DVT prophylaxis, prevention of stress ulcers, cardiovascular protection, and prevention of ventilator-associated pneumonia and catheter-related blood stream infections. The study also found a shorter hospital LOS. It should be noted that although 10 tele-ICU studies had favorable clinical outcomes, two did not. However, both these programs had varying degrees of tele-ICU involvement in the care of patients.18,19 In one study,18 almost two-thirds of the patients had minimal exposure to the tele-ICU, which could explain the absence of a mortality benefit. Thus, tele-ICU engagement to achieve desired outcomes is essential. There is now enough literature on tele-ICUs that two meta-analyses have been published. The first identified 13 studies involving 35 ICUs and 41,374 patients.22 This analysis showed lower ICU mortality and LOS but not lower in-hospital mortality or LOS. The second meta-analysis, which included 11 trials, found that tele-ICU was associated with lower ICU and hospital mortality among critically ill patients.23 The authors concluded that the optimal telemedicine technology configuration and dose tailored to ICU organization and case mix were unclear. When considering the metaanalyses,22,23 the results of the 10 trials,10-17,20,21 and the initial report from Rosenfeld et al,8 mortality benefit seems consistent. In summary, use of tele-ICUs has been successful. Tele-ICUs have been associated with improved adherence to best clinical practices and repeatedly with improved mortality and LOS. In addition to these measurable outcomes, tele-ICUs have shown benefit for patients with specific conditions, such as sepsis, ventilator-associated pneumonia, and CPR.24-30 Many believe that this technology is an important strategy to combat the growing demand for intensivists. It should be noted, however, that most often, tele-ICUs are just one aspect of health information technology bundles.17 Collectively, this technology has proven

ficial. The effectiveness of tele-ICUs alone cannot be ascertained. Making the Financial Argument to Hospital Administrations for a Tele-ICU Hospital administrators and governing boards must be cognizant of the financial consequences of teleICUs. Factors to consider include limited reimbursement of tele-ICU services, indirect financial benefits to hospitals, and initial capital and ongoing maintenance costs. With the current reimbursement system, assessing the return on investment can be quite complex and varies greatly depending on the specific design of the tele-ICU. Direct Reimbursement Reimbursement for telehealth services (eg, telepsychiatry, teledermatology) is not new. Medicare started reimbursing for telehealth with the Balanced Budget Act of 1997.31 In addition, Medicaid programs in 44 states pay for telehealth services in some fashion,32 and 19 states have legislation requiring commercial insurance companies to reimburse for telehealth.33 However, for the most part, tele-ICU services are not reimbursed in the United States. Tele-ICU was assigned temporary Current Procedural Terminology category 3 codes by the Centers for Medicare & Medicaid Services (CMS) (0188T, 0189T) that are generally used for data collection purposes only. These codes are infrequently submitted, and as such, CMS will have few tele-ICU data to evaluate. Furthermore, given the category 3 status, CMS has not assigned relative value units. Consequently, many payers do not recognize these codes for payment. Given these unfavorable decisions by CMS, most practices do not use the category 3 codes, and direct reimbursement for tele-ICU is minimal to none in 2013. Indirect Reimbursement Despite the lack of direct reimbursement, there are potentially significant indirect financial benefits to consider. Of the available literature, four studies commented on economic outcomes of the tele-ICU.8,10,12,19 Rosenfeld et al8 showed that variable costs decreased by $2,556 or 24.6% per case. The reduction in case cost was attributable to a decreased ICU LOS and to lower daily ancillary costs. Interestingly, the number of ICU cases per month increased by 7% as a result of capacity created by ICU LOS reduction. The monthly contribution to the margin increased by $524,000 (66%) during the intervention period, generating a financial benefit of $3.14 million over the 6-month intervention period. This value was far greater than the program costs.12 CHEST / 145 / 6 / JUNE 2014


The most detailed financial analysis to date was performed by the Massachusetts Technology Collaborative in conjunction with the New England Healthcare Institute.10 The University of Massachusetts Memorial Medical Center (UMMMC) implemented a tele-ICU within its medical center and placed the technology into two smaller community ICUs. PricewaterhouseCoopers LLP performed an independent analysis of this program. The change most affecting the financial results was the reduction in LOS, which was decreased by approximately 20%. Average revenue per case also decreased mostly because of a reduction in fee-based payments. The net effect of these changes was an improvement in the net contribution margin of approximately $5,400 per case. On an annual volume of about 4,600 cases, this amounted to nearly $25 million,10 which was more than enough to cover initial capital and ongoing operating costs. Benefits to Payers The New England Healthcare Institute study also showed a positive financial impact for payers. The reduction in LOS reduced payments associated with reimbursement arrangements based on a per diem or fee-for-service charges. Although the payments for patients covered under diagnosis-related group arrangements were not changed, the overall effect was an average reduction of $2,600 per case based on payer mix at the time of the study. On a base of about 4,600 annual ICU cases at UMMMC, these changes resulted in a benefit to payers of approximately $12 million each year.10 Capital Expenditures and Maintenance Costs Careful consideration of the development and maintenance costs associated with the implementation of a tele-ICU is mandatory. These costs can vary considerably. Starting a new tele-ICU designed to service multiple ICUs in a large health-care system or joining an existing tele-ICU for coverage of a small ICU is the greatest variable affecting costs. Given the significant variability, we discuss the capital expenditures and maintenance costs for these two scenarios separately. However, the quality and age of existing health information and biomedical technology at a given institution will dramatically affect start-up and maintenance costs. Larger Programs: Costs and Considerations: Minimal published data are available regarding capital expenses required to establish and maintain a tele-ICU partly because of the considerable variation among programs. Major variables include the type of system used, number of beds and ICUs covered, provider staffing, and number of hours covered. UMMMC’s tele-ICU covers 135 ICU beds at five hospitals. Implementation 1394

of this tele-ICU entailed substantial capital expenditure and one-time operating costs of $7,120,000. Furthermore, this program reports an ongoing annual incremental operating cost of $3,150,000.10 Smaller Community-Based Programs: Costs and Considerations: Tele-ICUs that monitor smaller community ICUs allow the hospital to keep its patients locally, benefiting both patients and families. Additionally, they allow the community hospital to care for more patients in the ICU with a higher case-mix index. Typically, community hospitals contract with existing tele-ICUs to obtain coverage.10 Both community hospitals covered by UMMMC’s tele-ICU benefited financially. Each hospital spent approximately $400,000 in one-time capital expenses and an additional $400,000 in ongoing annual expenses. This took the form of a contractual charge paid to UMMMC for tele-ICU coverage. After joining the tele-ICU program, the community hospitals experienced increased patient volume, increased retention rates, and increased ability to care for patients with a higher severity of illnesses. For example, one community hospital was able to admit and retain an additional 267 patients in the post-tele-ICU evaluation period. Because many of the patients had a higher severity of illness, each contributed an additional $4,000 ($5,000 pre-tele-ICU and $9,000 post-tele-ICU) to the margin for a total of $4,550,000. Thus, community hospitals can easily recoup their initial investment and add substantially to their margins.10 Implementation Considerations In the January 2013 issue of CHEST, Kumar et al34 concluded in their systematic review and analysis of costs of critical care telemedicine that clinicians and administrators should carefully weigh the clinical and economic aspects of tele-ICUs when considering this technology. We agree and add that critical care teams and administrators should also understand the operational and design components associated with teleICUs that have produced positive patient-related and financial outcomes. There are examples of tele-ICUs where outcomes were not ideal.18,19 In these instances, there seems to be suboptimal interactions between the ICU and the tele-ICU. In fact, with limited tele-ICU engagement, the desired mortality benefits and LOS reductions will likely not be achieved. Without improvements in clinical outcomes, hospital costs are more likely to increase.19 Therefore, it is essential to design a tele-ICU program that is actively engaged in patient care. Proper implementation is also essential to establish a successful program. Other ICU protocols with mortality benefit, such as ARDS Network ventilation and Topics in Practice Management

early goal-directed therapy, have been relatively easy to implement.35,36 In contrast, tele-ICU adoption has occurred more slowly. Establishing a new tele-ICU is a complex undertaking that requires significant change to both the critical care and the institutional culture. Strong physician leadership is important to achieve maximal buy-in from all bedside providers. In our experience, successful implementation requires a “how can we help” attitude by the tele-ICU team. Initially, many bedside providers are skeptical that the tele-ICU can effectively assist with patient care. This skepticism severely limits effectiveness. However, skepticism wanes and buy-in occurs as bedside providers realize the benefits of the tele-ICU. Nursing staff in particular enjoy increased ease of access to intensivists, which minimizes the angst associated with after-hours calls. The benefits of improved communications are numerous, including real-time discussions of patient status changes and interpretation of laboratory and radiographic studies. Ultimately, the real benefits of the program are achieved when bedside providers embrace the added care provided by the tele-ICU.

leveraging of the limited intensivist resource. Successful implementation of a tele-ICU program will not only result in improved outcomes but also allow greater access of critically ill patients to experienced intensivists. Ongoing evaluation should focus on defining the common operational design of tele-ICU programs that have produced improved clinical outcomes and efficiencies and that have financial stability. This field is ripe for study because a number of important questions have yet to be addressed. Chief among these are defining the roles and responsibilities for tele-ICU nurses, physician extenders, and physicians. Is there a maximum acceptable provider-to-patient ratio? Should all tele-ICUs perform specific assessments? In addition to assessing the clinical design, a careful study of operational targets and a financial analysis of teleICUs are warranted. These standards would facilitate access to care, delivery of superior clinical outcomes, and navigation of the financial white water surrounding health reform. Acknowledgments

Conclusions Although evidence accumulates in favor of teleICUs, many hospital administrations and governing boards remain reluctant to establish programs given the initial high capital outlay and lack of direct reimbursement. The original tele-ICU article by Rosenfeld et al8 showed improvements in mortality, LOS, and costs. Subsequently, the majority of the studies have shown similar results.10-17,20,21 Additionally, tele-ICUs enhance adherence to best practices, which improves other ICU-related outcomes.24-30 Even considering the lack of direct reimbursement, if a hospital is able to provide the initial capital and finance the ongoing operation, tele-ICUs can benefit the hospital’s profit margin.10 It is clear that some tele-ICU programs produce better clinical and financial outcomes than others. Why do these differences exist? The answer lies in the operational design of the program. To be successful, the tele-ICU must leverage the limited resource of intensivists. Although no two programs are identical, we believe that successful programs must have active engagement with patients and full buy-in from bedside providers. Unfortunately, not all programs meet these standards. These differences have led to the disparate findings among the programs.37 To get to the next level, a minimum set of standards for tele-ICU operations needs to be established. These standards should be based on how the technology is implemented rather than on the technology itself. Specifically, we should focus on defining and creating best practices. These practices should facilitate the

Financial/nonfinancial disclosures: The authors have reported to CHEST that no potential conflicts of interest exist with any companies/organizations whose products or services may be discussed in this article. Role of sponsors: The sponsor had no role in the design of the study, the collection and analysis of the data, or the preparation of the manuscript.

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Topics in Practice Management

Clinical and financial considerations for implementing an ICU telemedicine program.

As the population in the United States increases and ages, the need to provide high-quality, safe, and cost-effective care to the most critically ill ...
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